💸 Your first loan
What a loan actually is
When you want to buy something and can't afford it, you often have to borrow the money from someone else. When you take out a loan, you at the same time promise to pay it down over a certain period of time. The bank also makes sure to earn money on you as a customer, so you don't just pay back what you borrowed from them — you also have to pay money to the bank. This is called interest. On top of that, many banks have a fee, meaning a sum to cover the costs they have on you. Pretty annoying, since they're already earning money on you. But that's often how it is. If you borrow 10,000 NOK, you often have to pay back 13,000 NOK in practice. That's the price of not being able to afford it right now, but being able to afford it over time.
Interest: the price of borrowing
Interest is the percentage figure you're presented with when you take out a loan. Maybe you're told the loan has an interest rate of 7%. It tells you something about how much extra you have to pay the bank to get the money from them. The interest is simply the bank's salary. You want it to be as low as possible. Even a change from 7% to 6.9% makes a difference over time. Simply put, you have to pay in less money as "punishment" for not having the money in the first place. It's very important to know that the bank is not your friend. A (serious) bank that offers you a lower interest rate can quickly become your next friend. If you should get a better offer, let your bank know. Maybe they'll lower it. If they can, that's usually best. Because it often costs a little extra to move the loan to another bank.
Extra payments — the superpower
If you make extra payments — or have regular extra payments — these are not registered as "salary" to the bank. That money goes straight toward paying down what you actually owe. With every extra payment, the bank loses money on you. But you're very welcome to do it! This entire website was made mainly to explain to you the importance of paying in extra. Preferably regularly, every month. Because every 100 NOK a month is often worth 10 times as much in the long run.